Standard Merchantile Acquisition Corp Cl A T.TZS

Return of Capital

[ArbProfit]

There should be some news soon about the next return of capital for TZS.  It will almost certainly be another cash distribution.  The MIC is now holding approx $40M in loans, so it's small enough that it could be sold in its entirety to one, or a few buyers.  That would be the best case scenario. If not, we'll continue the long wind-up process.  Not exciting, but should be profitable.

[Pandora]

You were right -- news yesterday, next special distribution in February a return of capital. Not sure what happened with the last one -- does the share price then take a dip?  

[ArbProfit]

Yes, once it goes ex-dividend, the stock will drop accordingly.  As you probably know, they are winding up the fund, so all capital will eventually be returned to shareholders (less any costs or possible losses).  I expect the process to be complete mid-2018, unless they're able to selloff the rest of the portfolio.  The next number I'm looking for is the remaining net asset

[Pandora]

Ouch, there is a drop of $1.31 today which I suppose is in anticipation of the "special dividend" of $1.33 payable on Feb 21st for holders of record as of Feb 6th -- but this is only Feb 2nd.?

[ArbProfit]

Today, Feb.2nd, is the ex-dividend date.  You need to own it prior to the ex-date to be a shareholder on record Feb.6th and receive the dividend.  If you bought today, you won't receive the special $1.33 dividend (return of capital).

[Pandora]

Well it seems it's time for another return of capital. This time it is 66 cents per share payable on May 29. Share value will drop again. And on we go to the next. I see there is virtually no discussion here anymore -- does that suggest most people have sold and left after the last payout? I remember being in a 'Limited Partnership' possibly 25 years ago that did much the same. They

[ArbProfit]

I'm still holding some shares, mostly due to a lack of alternatives. Book value at Dec.31, 2016 was $6.92.  Subtract  $1.33 for the last special distribution and that leaves $5.59.  Then subtract approx $0.20 for the last four monthly distributions, and we're at a book value of approx $5.39.  There can, of course, be other deductions from fees, writing down mortgages

[Pandora]

And $5.39 minus 66 cents for the last special distribution leaves us with about $4.73. We are now trading at $4.50. So where does it go from here?

[Pandora]

Some simple math. Having bought 2500 shares at $6.42  ($16058.00) in November of 2016 (recommended by my broker?) and having received 6 payments of $121.25 and a special ROC of $3325 plus this last special ROC of $1650 (total $5702.50) I am now sitting in a positive position of $694 with the current share price of $4.50. I guess the question is will they give me back at least the $4.50 per

[ArbProfit]

First quarter earnings were released and stated a March 31st NAV of $5.49. Subtract $0.66 and two more monthly payments (including May) leaves $4.73 plus a small amount of interest earned on the outstanding loans. I have one quarter of my max position remaining, and will be selling most over the next few months. There is still some (small) risk in sticking around for the remaining spread between

[Pandora]

I'm not sure what you mean by this: "If I just put the money in my bank account at 2% and then withdrew it on a monthly basis I would be pretty close to where I am now and there would be no risk attached. Am I wrong?" I thought it was a fairly simple question so I'm not sure why you're not sure? If a person had say $30,000 to invest and decided to put it into T.TZS who were